Distribution agreement in Nigeria: Template, Key Clauses and Local Law (2026)

What a distribution agreement is under Nigerian law A distribution agreement is a contract where a supplier appoints a distributor to buy its products and resell them in a defined territory. In Nigeria the distributor usually buys stock on its own account and sells to customers at its own prices and risk. That is different from an agency arrangement, where an agent sells in the supplier's name and the supplier keeps title to the goods until the customer buys. The label you use matters, because it decides who carries the stock risk, who sets the price, and who the customer can sue. Nigeria has no single statute dedicated to distribution agreements. The contract is governed mainly by ordinary Nigerian contract law, built on common law principles and interpreted by the courts. Several other laws can touch a distribution deal depending on what it contains, so you draft the commercial terms freely but check them against the rules below. This page is general information, not legal advice. Confirm the current position with a Nigerian lawyer before you sign, because the detail changes with the product, the parties and the state. ## The local law that shapes the deal Competition and consumer law. The Federal Competition and Consumer Protection Act 2018 (FCCPA) and its regulator, the FCCPC, govern agreements that may lessen competition. Exclusive territories, minimum resale prices and tie-in clauses are the terms most likely to attract attention. The Act does not ban exclusivity outright, but resale price maintenance and arrangements that shut rivals out of the market are the ones to handle with care. Technology transfer and NOTAP. If the agreement bundles a trademark licence, know-how or other technology transferred from a foreign supplier, it may fall within the scope of the National Office for Technology Acquisition and Promotion (NOTAP). NOTAP registration affects a Nigerian party's ability to remit fees and royalties abroad through official channels. A plain resale deal with no technology element usually sits outside NOTAP, but a branded or licensed arrangement should be checked against the current NOTAP guidelines. Imports, standards and tax. Imported goods must clear Nigeria Customs and, for regulated products such as food, drugs and electronics, meet NAFDAC or SON standards. Payments and any foreign exchange follow Central Bank of Nigeria rules. Value added tax applies to the supply of goods, and withholding tax can apply to certain payments. Stamp duty. Agreements executed in Nigeria are chargeable with stamp duty, and stamping is generally expected within 30 days of execution. Stamp an unstamped agreement before you need to rely on it in court or before a regulator. ## A distribution agreement template you can adapt ```

DISTRIBUTION AGREEMENT This Agreement is made on [date] BETWEEN [Supplier name], of [address], company number [RC number] (the "Supplier") AND [Distributor name], of [address], company number [RC number] (the "Distributor") 1. APPOINTMENT The Supplier appoints the Distributor to distribute the Products listed in Schedule 1 in the Territory. The appointment is [exclusive / non-exclusive / sole]. 2. TERRITORY The Territory is [states / regions of Nigeria, or "the Federal Republic of Nigeria"]. The Distributor will not actively sell outside the Territory. 3. TERM This Agreement runs for [number] years from the date above and renews for further [number] year periods unless either party gives [number] days written notice before the end of a term. 4. ORDERS, PRICE AND PAYMENT The Distributor buys Products on its own account at the Supplier's list price in Schedule 2, less [discount]. Payment is due within [number] days of invoice, in [Naira / USD]. Title and risk pass to the Distributor on [delivery point]. 5. MINIMUM PURCHASE The Distributor will buy at least [quantity or value] of Products in each [year]. Failure may convert an exclusive appointment to non-exclusive. 6. OBLIGATIONS OF THE DISTRIBUTOR Promote and sell the Products, hold adequate stock, keep to applicable NAFDAC / SON and other laws, and not sell competing products without consent. 7. OBLIGATIONS OF THE SUPPLIER Supply conforming Products, provide product information and reasonable marketing support, and honour the product warranty in Schedule 3. 8. INTELLECTUAL PROPERTY The Distributor may use the Supplier's trademarks only to sell the Products and gains no rights in them. [If a technology or trademark licence is granted, the parties will consider NOTAP registration.] 9. TERMINATION Either party may end this Agreement on [number] days notice, or at once for material breach not cured within [number] days, insolvency, or a change of control. On termination the Distributor stops using the marks and the Supplier may buy back unsold stock at [price]. 10. LIABILITY AND INDEMNITY Neither party is liable for indirect or consequential loss. Each indemnifies the other for loss caused by its breach or its own acts. 11. GOVERNING LAW AND DISPUTES This Agreement is governed by the laws of the Federal Republic of Nigeria. Disputes will be resolved by [arbitration in Lagos under the Arbitration and Mediation Act 2023 / the courts of Nigeria]. 12. GENERAL Entire agreement, no assignment without consent, notices in writing, stamp duty to be paid by [party]. SIGNED for and on behalf of the Supplier ____________ SIGNED for and on behalf of the Distributor ____________

- Exclusive territory with no minimum purchase, which leaves the supplier locked in with no volume.
- Resale price terms or market sharing that could breach the FCCPA.
- A foreign trademark or technology licence with no thought given to NOTAP registration and remittance.
- No stamp duty paid, so the agreement is harder to rely on when you need it.
- A foreign governing law clause with no practical way to enforce a judgment or award in Nigeria. ## Keeping distribution contracts consistent as you grow A distributor rarely signs one agreement. It signs a template again and again, with different territories, discounts, minimums and renewal dates, and each one quietly drifts from the last. The real work is not drafting the first agreement, it is keeping fifty of them consistent and knowing which renewal or minimum target is coming due. That is the same problem every contracting business has: drafting from a house template, catching a clause that sits oddly against local law, editing a term across many documents, and tracking the dates that matter, all in one place. [Adira](https://adiralaw.com) is built around that single workspace idea, with the deepest coverage today for Indian corporate law and support for other jurisdictions being broadened. Nigeria specific depth is on the roadmap rather than in place today, so for a Nigerian deal use the template above and have local counsel confirm it. The point worth taking is that contracts are easier to trust when drafting, review and renewal tracking live together instead of scattered across inboxes.